Lehman trader tells (nearly) all

Our Weekly Read column features Fortune staffers’ and contributors’ takes on recently published books about the business world and beyond. We’ve invited the entire Fortune family — from our writers and editors to our photo editors and designers — to weigh in on books of their choosing based on their individual tastes or curiosities. Each Friday we feature a different review. This week, on the anniversary of the Lehman Brothers bankruptcy, Fortune.com blogger and Term Sheet editor Dan Primack takes a look at Street Freak: Money and Madness at Lehman Brothers, Jared Dillian’s memoir of his career as a trader at the once-storied firm.

Jared Dillian is a bipolar math whiz whose path to Wall Street led through the Coast Guard rather than the Ivy League. He also is an amusingly caustic writer whose new memoir pulls no punches about a financial career that nearly cost him both his sanity and his life.

Street Freak opens on September 11, 2001, when Dillian was scheduled to begin his first rotation as a trader after graduating from Lehman’s training program. It ends seven years later, when Dillian quits amid the chaos of Lehman’s sudden bankruptcy. But neither bookend gets more than a few pages of attention. Dillian wants us to understand what happened in between.

It’s a bleak story, to be sure. Dillian’s bipolar disorder — not diagnosed until late in the book — leads him to phone-smashing tantrums on the trading floor, alcohol-fueled blackouts after client meetings, and an unsuccessful suicide attempt.

And Lehman’s trading culture seems to feed Dillian’s sickness. The author portrays trading as a manic sprint of decision-making that is part mathematics, part intuition and part speed. Tens of thousands of dollars rest on every click of the button, hundreds and sometimes thousands of times per day.

The reader may not understand all of the mechanics — Dillian sometimes tries to explain them, sometimes not — but the dizzying pace is made palpable by dozens of pages of play-by-play on past trades. It’s an effective technique, albeit one that compelled me to gloss over more than a few sections.

In some cases, Dillian revels in how he outsmarted competitors. For example, he realizes that the market seems to stand still for a couple of seconds whenever major economic data is released. What if he could trade just milliseconds earlier, by sitting with his finger at the ready? It was a strategy that would make millions of dollars for Lehman and help Dillian get promoted, eventually, to the firm’s ETF trading desk.

At other times, however, Dillian makes clear that he only really cared about the money, which represented his standing within Lehman and, ultimately, his level of success. In this he was not alone. Lehman may have considered itself a scrappy team, but in the end, everyone was out for himself at the expense of everyone else. A smaller bonus for you means a bigger bonus for me, which is what I’m here for.

It is a corrosive mindset, and the accompanying pressures eventually became too much for Dillian to handle. In a way, Lehman’s bankruptcy functioned as the author’s personal bailout. Had the bank not collapsed, he might have had a tougher time walking away.

Street Freak’s main failings are twofold. First, Dillian’s wife barely makes a cameo. Here’s a guy whose life changes in momentous ways over a seven-year stretch, but his spouse is completely absent apart from minor pop-ins. Did he leave her out intentionally? Or was Dillian’s marriage more about the official stability than the day-to-day relationship? It’s an odd omission in such a personal book.

Second, it’s not always clear whom Dillian is writing for. Other traders? Lay people trying to better understand Wall Street before the crash? Or himself, as a sort of catharsis, not to mention promotion for the financial newsletter he now runs? The answer seems to change depending on the chapter, which may reflect how Dillian views both himself and the career he left behind.

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